ER vs CB

Hi all,

First time posting (in a long time), but long time creeper. I'm currently an ER associate at a boutique shop covering large-cap financials. Been here for about two years. During that time I wrapped up the CFA exams. I also have CPA from my previous life in Big 4. Work and pay are both OK, but learning and progression seems to be limited from this point on.

Through a random app and the usual process, I scored an offer with a local BB - in CB though, but with a small pay bump initially, and the promise of a promo to VP within 1.5 years.

There have been a lot of posts on exit opps for ER associates, including move to buy side, high grade (to BB ER), IB, corporate finance, etc.

So here is my question to WSO: would a move to BB corporate banking be equivalent to committing career suicide given that my ultimate goal is to become a CFO or be the head of Corp Dev at a F500? Or would having a bigger name attached to my profile along with signs of career progression provide a boost?

Lastly, would this move shut out all the other usual exit opps?

Thanks!

 

Hi snoasis, no, I never sleep and so I can respond to any lonely threads (like this one) at all hours of the night. Impressive, I know ;-)

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What do you mean by "elite boutique ER"? Is this something like an ISI or Zelman (i.e. really good boutique ER shop) or one of the places this board considers a banking "elite boutique" but which generally is mediocre at ER (lazard, evercore, etc)

In any case, neither will put you in a position to transfer to PE, and even corp dev might be tough just because the nature of the work's quite a bit different (they tend to prefer M&A experience).

Assuming you're at well regarded shop, lateraling to banking from ER should be doable though. The work in corp banking's probably more relevant on a day-to-day basis since it's more transaction oriented, but IBD people tend to look down on corp banking, justified or not, so lateraling could be difficult.

 

I would be covering the sector I'm interested in. The only thing that worries me about ER is the lack of transaction experience. I've spoken with people in ER that struggle to get where they want because of this.

 
Gulf Coast Finance:
I would be covering the sector I'm interested in. The only thing that worries me about ER is the lack of transaction experience. I've spoken with people in ER that struggle to get where they want because of this.

If you're set on the course you've listed...I would say go commercial banking. However, ER at an elite boutique would arguably be better for your CV in general.

Please don't quote Patrick Bateman.
 
DBCooper:
Gulf Coast Finance:
I would be covering the sector I'm interested in. The only thing that worries me about ER is the lack of transaction experience. I've spoken with people in ER that struggle to get where they want because of this.

If you're set on the course you've listed...I would say go commercial banking. However, ER at an elite boutique would arguably be better for your CV in general.

Corporate banking =/= commercial banking. Corporate banking deals with Revolvers, Term Loans, credit agreements, etc. IN A NUTSHELL.

Please make that distinction, thanks. I'm sure a lot of corporate bankers would feel insulted (like the rest of the IBD) if they were grouped with commercial bankers.

 

Don't really see myself working for a hedge fund, and am not wild about IR jobs either. I know there are other exit ops for ER, but these two seem the most common (please correct me if I'm wrong). Geography is also an issue, I would prefer to be in the city in which the corp. banking job is. I'm just trying to figure out which job puts me in the best position to eventually achieve my goals. If I do corp. banking I think I will try to lateral to IBD after a year or two, and explore corporate options at that time as well.

 
Gulf Coast Finance:
Don't really see myself working for a hedge fund, and am not wild about IR jobs either. I know there are other exit ops for ER, but these two seem the most common (please correct me if I'm wrong). Geography is also an issue, I would prefer to be in the city in which the corp. banking job is. I'm just trying to figure out which job puts me in the best position to eventually achieve my goals. If I do corp. banking I think I will try to lateral to IBD after a year or two, and explore corporate options at that time as well.

Assuming the firm is reputable (meaning your analyst is II ranked or runner up), ER -> banking is likely going to be way easier than from corp banking, even if the actual work is more similar in corporate banking. In my experience at least, corporate banking just isn't that well regarded by most bankers

 

I haven't posted on this site in years but I can't resist the urge to opine on this one. I am currently a VP at a bulge firm and I spent my analyst and early associate years in corporate banking (think bulge firm - the best of the best for corporate banking). After a multi year painstaking effort, I successfully lateraled into IB (same firm) at the associate level. Here is my advice:

1) It's smart to think several steps ahead. However, this is a challenging hiring environment for our industry. It's not going to materially improve anytime soon. There are very few seats and transitioning into IB as a lateral is an uphill battle. I would consider selecting the path that you will most enjoy long term assuming an IB lateral move never works out.

2) An MBA always positions you for a second chance. However, an MBA isn't as valuable (read: requisite) as it used to be. So disregard this option if you would prefer to bypass grad school.

3) The ER role makes a lot of sense assuming (a) it's a superstar analyst, and (b) it's an industry you don't mind committing to long term. Assuming a and b, the industry expertise and client relationships can be parlayed into an IB industry coverage role.

4) The CB role makes since assuming it is JPM/BAML/WF because you can focus on building internal relationships to leverage into an internal IB role. It also provides you with the ability to gain capital structure advisory expertise and a breadth of capital markets knowledge. Combined, this represents half of the skill sets you need for IB coverage (the other half being M&A). Finally, if IB coverage isn't a possibility, you can focus on finding a leveraged finance or related dcm role....and buyside opportunities will be in the cards long term.

Difficult decision. Good luck.

 
Monopolisf:
I haven't posted on this site in years but I can't resist the urge to opine on this one. I am currently a VP at a bulge firm and I spent my analyst and early associate years in corporate banking (think bulge firm - the best of the best for corporate banking). After a multi year painstaking effort, I successfully lateraled into IB (same firm) at the associate level. Here is my advice:

1) It's smart to think several steps ahead. However, this is a challenging hiring environment for our industry. It's not going to materially improve anytime soon. There are very few seats and transitioning into IB as a lateral is an uphill battle. I would consider selecting the path that you will most enjoy long term assuming an IB lateral move never works out.

2) An MBA always positions you for a second chance. However, an MBA isn't as valuable (read: requisite) as it used to be. So disregard this option if you would prefer to bypass grad school.

3) The ER role makes a lot of sense assuming (a) it's a superstar analyst, and (b) it's an industry you don't mind committing to long term. Assuming a and b, the industry expertise and client relationships can be parlayed into an IB industry coverage role.

4) The CB role makes since assuming it is JPM/BAML/WF because you can focus on building internal relationships to leverage into an internal IB role. It also provides you with the ability to gain capital structure advisory expertise and a breadth of capital markets knowledge. Combined, this represents half of the skill sets you need for IB coverage (the other half being M&A). Finally, if IB coverage isn't a possibility, you can focus on finding a leveraged finance or related dcm role....and buyside opportunities will be in the cards long term.

Difficult decision. Good luck.

Good post

 

Corporate Banking varies greatly from firm to firm...so let's not generalize or stereotype. Some corporate banking platforms are limited to bank financings and ancillary business such as treasury services. That's not a gainful route. Others partner with their investment banking counterparts to deliver the full breath of their firms's capital markets capabilities. Corporate banking platforms in the latter category lead the charge advising clients on capital structure advisory, ratings advisory, financial policy and shareholder distribution policy advisory, and financing origination and execution across the bank, bond, subordinated capital, and convert markets. Basically they are takes with all things non strategic (equity, M&A). Very good place to be.

...the OP needs to develop a strong perspective of the role prior to making a decision.

 

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